Cash ISAs

A Cash ISA could work for you if:

• you want to earn tax-free interest on your cash savings
• you’re a UK resident for tax purposes
• you’re aged 18 or over (see Junior ISAs if you're under 18).

You can save up to £20,000 into Cash ISAs until the end of the 2026/27 tax year. 

From April 2027 you will be able to save: 

• up to £12,000 if you’re under 65 
• up to £20,000 if you’re 65 or over. 

If you want to change providers – for example, if you find another ISA that’s offering a better interest rate – you must ask your new provider to carry out the transfer in order to keep your savings tax-free. If you withdraw the money yourself – even if you put the money straight into a new ISA – you’ll lose the tax-free status. 

Here's how it works:

• Although your current provider must let you transfer your ISA to a new account, your new provider might not accept ISA transfers. Check before you decide which provider you want to switch to. Your current provider might charge a penalty for transferring. Check for any fees or charges to make sure transferring is still worthwhile.
• You can transfer your current Cash ISA, as well as your ISAs from previous years. You can choose to transfer all or some of the money.
• If you’ve got a Stocks and Shares ISA, you can also transfer money back into a Cash ISA until 6 April 2027. You'll have to complete a transfer form with your new Cash ISA provider who will then sort out the transfer for you.
• A Lifetime ISA pays a government bonus on top of anything you transfer into it up to a maximum of £4,000 a year (2025/26 allowance). You can even transfer the money from a Cash ISA. See our guide on Lifetime ISAs for more on this.

• Be aware of teaser rates that are high for a short period of time before dropping off to a low level. If you find that you’re no longer earning a competitive interest rate, look for a higher rate Cash ISA to transfer into. Opening multiple ISAs of the same type and transferring money into them could get you better deals. Some ISA providers offer better rates for bigger balances if you’re looking to consolidate more than one ISA account. But keep an eye out for charges and penalties.
• Many Cash ISAs are instant access accounts paying a variable interest rate. But some Savings Bonds offering a fixed rate over a fixed term can also be Cash ISAs (with your money being paid into an instant access account once the bond matures). Don’t tie your money up unless you can afford to or you might have to pay early withdrawal penalties.
• Be aware of fixed-term Cash ISAs offering very high interest rates. Some of these products are what's known as 'structured deposits' and you’re taking a gamble on the performance of an index or a commodity price. You might get no income or capital growth, and charges might be deducted from your capital. This is because any return on your investment depends on rules – for example, the FTSE 100 index will have to increase by 5% over a five-year period.

• With instant access Cash ISAs you can withdraw money when you want to.
• With fixed-term Cash ISAs, you’ll get your money back at the end of the period you signed up for (‘the term’). Some accounts allow early withdrawals, but there might be a penalty.

• If you withdraw early from a fixed-term account, there might be charges.
• Your provider might charge penalties and fees if you transfer your Cash ISA to another provider.

Cash you put into UK authorised banks or building societies – including within a Cash ISA – is protected by the Financial Services Compensation Scheme (FSCS).

The FSCS savings protection limit is £120,000 (or £240,000 for joint accounts) per authorised firm.

Cash ISAs are available online, through a branch, by post or over the phone, depending on the product and provider.

These sites are a good place to compare Cash ISAs: 

• Which? Opens in a new window
• MoneyfactsOpens in a new window 
• MoneySavingExpert Opens in a new window

It’s worth using more than one as comparison sites can give different results.  

It’s also important to do some research into the type of product and features you need before choosing or changing provider. 

Banks and building societies are regulated by the Financial Conduct Authority (FCA).

If you have a complaint, look on the provider’s website and first put your complaint to them, this gives the business a chance to sort things out first. If you’re still unhappy and your issue isn’t resolved, you can take your complaint to the Financial Ombudsman Service.

See How to complain to your bank, lender or card provider for more information.

An ISA is an individual account – although you can leave the value of your ISA account to someone else, they can’t inherit it as an ISA. But there’s a special allowance to help in this situation.  

If your spouse or civil partner dies and their ISA comes to an end, you can make an additional contribution to your own ISA equal to the amount in their ISA. So you can transfer the value of their ISA across into your ISA and maintain the tax benefits, even if you’ve used up your own ISA allowance for that tax year.

If there’s no surviving spouse or civil partner (for example, if the inheritance goes straight to children or other relatives), ISA savings pass to the estate but lose their ISA ‘tax wrapper’. ISA savings are also subject to Inheritance Tax under the same rules as the rest of the estate. 

All ISAs (apart from Junior ISAs) can continue to grow in value, tax free, for up to three years and one day from the date of death. For example, any interest earned after the date of death but before the probate process completes would remain tax free (as long as probate completes within the three-year limit).